Different, but not comparativeGarrett K Smith

This is a question of debate among some experts.
Joseph Pine and James Gilmore, the two authors of a very
interesting book named The Experience Economy, suggest
that our nation is now moving away from the current
service economy and into what they are calling the
experience economy.

The world from its inception has
undergone several different economic phases. In the
beginning in the first ever human economy, humans lived
in a commodities driven economy. An example of a true
commodity--at least the example given in the book--would
be a coffee bean. Coffee as a commodity trades for about
$1 per pound or roughly translated one or two cents a
cup.

The next economic phase the goods phase is seen in
the grocery store. A manufacturer will take the coffee
beans, grind them, package them, and distribute them. The
beans have now become a good. The price to the consumer
now lands somewhere between 5 and 25 cents a cup. Even
later, in the service economy, a small coffee shop can
brew the coffee and serve it in a cup for about 50 cents
to a dollar per cup. So, what if the coffee is now served
in a fancy expresso bar overlooking the city of San
Francisco? A customer will now gladly pay $2 to $5 per
cup.

Why will someone pay up to $5 a cup for something that
is only worth 50 cents somewhere else? It is the
experience and memories surrounding the cup of coffee,
not the actual coffee that is fetching the larger price.
One quick look around and you'll start to see the new
experience economy taking root. The Hard Rock Cafe, FAO
Schwarz, Niketown, The Geek Squad, to name a few
companies in the business. People are now hungry for
services that can fill items that are higher on our list
of hierarchical needs. Feeding people, or providing the
goods or services they need isn't enough anymore. People
are looking for experiences that will provide them with
personal memories and they are willing to pay a premium
to get what they want.